Small Town News

Financial reform still lacking

---

Summary: The country is still without the necessary and crucial aspects of regulation.

Fool us once, shame on us.

Fool us twice, bail them out again?

That appears to be the strategy of attempts in Congress to overhaul the financial system which cataclysmically failed, leaving the economy in ruin and taxpayers on the hook.

It took a year just to get the first draft of a reform bill into Congress and Treasury Secretary Timothy Geithner went so far as to declare that anything less than a total overhaul would be inadequate.

"Our system failed in fundamental ways," he told Congress. "To address this will require comprehensive reform. Not modest repairs at the margin, but new rules of the game."

Unfortunately, rather than new rules we have the same old games in Congress.

America's financial meltdown was caused in large part by unregulated transactions and the lack of oversight of "top-big-to-fail firms." Our government did nothing to even assess the risks that eventually threatened our entire system.

Coming down the Congressional chute is a bill that is likely to encompass many essential aspects of reform'", including, new ways to protect consumers, regulate derivatives, curtail toe-big-to-fail firms and police risks that threaten the entire system.

Until all of these financial aspects are put into full view of regulators, our country is not safe from a repeat of the financial fiascos of the past two years.

An independent agency which oversees and protects consumers is also a crucial part of repairing the distrust and damage done.

This kind of oversight was missing before the financial crisis, when regulators generally allowed banks to sell anything that turned a profit. The result was disastrous subprime lending and other dubious loans. Without a strong consumer protection regime, banks are bound to revert to the pre-crisis status quo when the coast is clear.

We need strong leadership from Congress and the White House as this bill'moves into debate because it's bound 'td face aii enormous number of challenges from the banking lobby.

Reform is crucial and it must come while the disasters of the past are fresh in the minds of voters.



Copyright 2010 Turtle Mountain Star, Rolla, North Dakota. All Rights Reserved. This content, including derivations, may not be stored or distributed in any manner, disseminated, published, broadcast, rewritten or reproduced without express, written consent from SmallTownPapers, Inc.

© 2010 Turtle Mountain Star Rolla, North Dakota. All Rights Reserved. This content, including derivations, may not be stored or distributed in any manner, disseminated, published, broadcast, rewritten or reproduced without express, written consent from DAS.

More from Turtle Mountain Star